How Retention Policy works if we set RECOVERY WINDOW for N days

For an example If we are taking L0 backup on Sunday and L1 incremental backup over the week day from Monday to Saturday

If we set RECOVERY WINDOW OF 1 DAYS, it Means RMAN would not consider the incremental level backups which we took on weekdays as obsolete. The previous L0(Sunday) and L1 incremental backups will exist for a week until next L1 backup starts after next Sunday L0. 

The below diagram will explain in More detail